Europe stocks flat as investors await U.S. Fed and earnings

The STOXX Europe 600 dipped about 0.2% in early trading, with defensives and miners helping limit the decline even as cyclical pockets softened. The cautious tone followed a turbulent stretch sparked by abruptly announced tariff threats tied to Greenland that were later withdrawn, leaving markets still debating how aggressively tariffs could be used in future negotiations.

Sector performance was mixed. Travel and leisure stocks lagged, and defense names also slipped, while mining shares advanced alongside firmer precious metals prices. In London, gains in miners helped offset declines in industrial and travel-related stocks, keeping the major indices close to flat.

Company news drove several of the day’s larger moves. Ryanair shares fell after its earnings update, while Danone dropped after announcing a recall of certain baby formula batches in targeted markets. Airbus shares also eased after the company flagged geopolitical risks internally, adding to the cautious tone across industrial names.

Investors also kept one eye on central banks and rates. Markets are heading into the Fed’s policy meeting with heightened sensitivity to how the central bank frames inflation risks and independence concerns, a focus that has intensified amid political scrutiny of the institution and the prospect of leadership changes later on.

In Germany, stocks were modestly lower even as a closely watched business-morale reading held steady, offering little fresh direction for risk assets. Meanwhile, autos traded quietly despite attention on India’s plan to sharply reduce import tariffs on EU cars, a development that could reshape competitive dynamics over time but did not move the sector on the day.

The broader backdrop remained defined by cross-asset volatility. A surge in demand for safe havens has supported gold and other defensive positioning, while bond-market moves and shifting rate expectations continue to steer equity risk appetite more than single headlines.